Mortgage Rates Newsletter - Market Analysis

Wed, 20 Mar 2019 22:00:51 GMT - Mortgage rates broke a week-long streak of silence today following a policy announcement from the Federal Reserve. Even before today's Fed announcement, we knew we'd likely be seeing a move in rates. We just didn't know in which direction, or at what pace. As it happens, we were treated to the best case scenario on both accounts (i.e. rates moved lower at a fast pace). As we discussed yesterday, it was the Fed's balance sheet that got most of the attention from financial markets. This refers to the Fed's loan portfolio consisting of Treasuries and mortgage-backed-bonds (both forms of loans that entitle the Fed to collect interest and principal payments). As those payments came in, the Fed had previously been putting the money back into new loans (buying new bonds to replace the old ones). They

Tue, 19 Mar 2019 20:17:05 GMT - Mortgage rates were flat for the 4th day in a row today in a sign that investors have largely taken their seats for tomorrow's big show. The Fed will release its new policy statement at 2pm tomorrow, and while they're not expected to hike rates this time around, there are other important considerations that could have a big impact on rates. One of the considerations is the fact that March is one of the months where the Fed updates its economic projections. Investors largely tune-in to these for a glimpse at the collective rate hike outlook. This has caused big market movement in the past, but something else could be even more important tomorrow. The Fed has increasingly mentioned the impending end of its balance sheet runoff , which refers to its policy of NOT buying bonds with the money it

Mon, 18 Mar 2019 21:02:11 GMT - Mortgage rates didn't budge today--a logical result with no signs of life in underlying bond markets. In the current case, this is just fine with us considering the bond market has gone silent while remaining at the best levels in 14 months. Specifically, mortgage-backed-securities (MBS, the most important ingredient in determining mortgage rates) are at 14 month highs. When MBS are higher, rates are lower (14-month lows in this case). 10yr Treasury yields, on the other hand, spent a few hours at stronger levels on January 3rd, 2019. The only reason I bring up the modest discrepancy between Treasuries and MBS is to illustrate a point that we should keep in mind this week. Treasuries are capable of moving much more quickly than mortgage rates. That's why Treasuries made it to lower rates in

Frequently Asked Questions

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client profiles. Depending on what your employment type is, and how your credit
looks, you may have different options available to you. For a profile analysis,
you should contact I Want a Better Mortgage. From there, we can recommend some
great options, tailored to your situation. Generally speaking, there are two
types of mortgage terms. Open or closed. If you are unsure whether closed or
open, fixed or variable is right for you. Read on, the info below will give you
a better understanding. We are still just a phone call away in case you want to
talk to a live mortgage professional about any of the options listed below.

Open vs. Closed

An open mortgage is 100% open for prepayment at any time
throughout the term of the loan. This means that you have the option to repay
any or all of the mortgage balance at any time without penalty. This type of
mortgage may be important to you if you can foresee repaying your mortgage loan
in the near term. For example, you may be planning to sell your home within the
term of the mortgage and paying it out in full, or you may be expecting other
money that will allow you to make large prepayments to mortgage loan. A closed
mortgage has restrictions on how much of the principal you can repay without
penalty within the term of the loan. Most closed mortgages will allow you to
repay a certain portion of the principal amount every year without penalty. The
amount you can prepay depends on the lending institution but usually ranges
from 10% to 25% of the original principal amount per year. There may be
restrictions on when these prepayments can occur and how many times per year
you can make a prepayment. For example, you may be able to only make
prepayments once throughout the year on the anniversary date of the mortgage or
the prepayment may need to coincide with a payment date. Your mortgage
professional will discuss these policies with you as each institutionšs policies
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Fixed Rate vs. Variable Rate

A fixed rate mortgage is where the interest rate is set at
the time you get your mortgage loan and will not change for the entire term of
the loan. For example, if you take out a 5-year term, fixed rate mortgage at
5.25%, you know that your rate is fixed at 5.25% for five years and will not
change. This type of mortgage offers you security and peace of mind, as you
know exactly what the interest rate and payments will be. You will generally
pay a little higher interest rate for a fixed rate mortgage and the rate
usually increases with the length of the term. A variable rate mortgage is a
mortgage where the interest rate is tied to and floats with the bankšs prime rate.
If the prime rate goes up, then your rate goes up. If the prime rate goes down,
then your rate goes down. Variable rate mortgages usually offer the lowest
available rate because you are taking the risk that rates may rise. There are
many different options available for variable rate mortgages. Your mortgage
professional will help you review all of your options to find the best mortgage
available.

Mortgage Term

The term of the mortgage is the contractual life of your
mortgage loan. The term represents the length of time that you and the
financial institution are obligated to each other with respect to your
mortgage. As you choose your mortgage, the term is one of the decisions you
will need to make. The term of the mortgage is usually shorter than the actual
life, or amortization of your mortgage. Once the term has expired, the mortgage
is completely open for renegotiation. At that time, you have the right to find
a new lender if you wish and your financial institution has the right to
re-qualify you before renewing your mortgage. In practice, as long as your
mortgage is current and all payments have been made as agreed, financial
institutions will often automatically renew your mortgage, and not require that
you re-qualify.

Payment Frequency

Most lenders allow several options for payment frequency
(how often you make your mortgage payments). Most will allow you to make
payments either weekly, bi-weekly (every two weeks), semi-monthly (twice a
month) or monthly. Choosing which type of payment to make will be a matter of
convenience, but there may be advantages to paying more frequently than
monthly. When you increase the payment frequency, you reduce the principal
faster, pay less interest and pay off the mortgage sooner. Contact us to
discuss the options that will work best for you.